The signature that turned gas into guaranteed dollars
By 2015, the pieces were lined up. Aminex had its discovery well, its government development licence, and Tanzania’s new processing plant and pipeline at Songo Songo were finally nearing readiness. What it still lacked was the most important piece of paper in any gas project: a sales contract.
That arrived on 13 January 2016, when Aminex announced that it had signed a fully-termed Gas Sales Agreement (GSA) with the Tanzania Petroleum Development Corporation (TPDC). For the company, it was the milestone shareholders had been waiting on for years.
The terms were clear, simple, and bankable:
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Price: US$3.00 per mmbtu (≈US$3.07 per mcf).
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Currency: Revenues in US dollars.
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Indexation: Annual adjustment using US CPI from 2016 onward.
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Structure: Take-or-pay depletion contract, ensuring TPDC had to either take delivery or pay for a minimum volume each year.
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Security: Monthly payments in advance, secured by letter of credit from Tanzania Investment Bank.
For a junior like Aminex, these terms were gold. Selling at the wellhead meant the joint venture partners didn’t shoulder pipeline or processing fees. The fixed dollar price insulated them from volatile global oil and gas markets. And the take-or-pay clause provided certainty that cash would flow even if volumes were lower than forecast.
It had been a long wait. The discovery was made in 2008, the development licence granted in 2011, and only now — eight years later — was Aminex in a position to sell gas. But when the GSA landed, it transformed the company overnight: a real producer in the making, not just an explorer.
For investors, this RNS was a watershed moment. Aminex had crossed the line from “exploration story” to “revenue story.” After years of patience, shareholders could finally expect the next announcement to be about gas flowing and dollars in the bank.
➡️ Next time: Chapter Five — First Gas. We’ll follow the moment molecules finally moved from the wellhead into Tanzania’s national grid, and Aminex booked its first ever production revenues.